Utility Theory and Rent Optimization: Utilizing Cluster Analysis to Segment Rental Markets
The research reported here segments apartment residents and units into homogeneous groups. This segmentation is accomplished via cluster analysis. The purpose of the research is to identify market segments with higher marginal utility preferences for selected project or unit amenities; with the ultimate goal of rental rate optimization. The uniqueness of the research is twofold in that the "tenant response" based hedonic analysis is modeled via cluster analysis instead of the typical regressive framework. The usefulness of the research is based in the presentation of a methodology that should at least be considered as an adjunct technique to the typical regression analysis.
Volume (Year): 4 (1989)
Issue (Month): 1 ()
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References listed on IDEAS
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- Austin J. Jaffe & C. F. Sirmans, 1984. "The Theory and Evidence on Real Estate Financial Decisions: A Review of the Issues," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 12(3), pages 378-400.
- Abelson, Peter W., 1979. "Property prices and the value of amenities," Journal of Environmental Economics and Management, Elsevier, vol. 6(1), pages 11-28, March.
- Karl L. Guntermann & Stefan Norrbin, 1987. "Explaining the Variability of Apartment Rents," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 15(4), pages 321-340.
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